IBM (IBM) introduced a new sub-1 nanometer chip that helps position the company as a long-term winner in the AI hardware market, Wedbush Securities said Friday in a note.
The chip fits about 100 billion transistors on an area the size of a fingernail and uses a new "3-D nanostack" design that vertically layers components to boost performance and energy efficiency, Wedbush said.
The architecture can deliver up to 50% more performance or 70% better energy efficiency than IBM's current 2 nm chips, improving the company's ability to support compute-heavy applications such as generative AI, cloud infrastructure and next-generation devices, the note said. The design also improves memory density, which helps chips move data faster, Wedbush said.
IBM also plans to form a standalone quantum-focused manufacturing unit called Anderon, which would produce quantum wafers and support the broader strategy, the note said.
"IBM's positioning at the forefront of AI and quantum remains underappreciated," the note said.
Wedbush maintained its outperform rating on IBM stock with a $350 price target.
Price: $269.03, Change: $+10.76, Percent Change: +4.17%